Cost of an hour worked increased by 1.2 per cent in October to
December year-on-year

Private sector labour costs increased by 1.2
per cent in October to December 2018 when compared with the
respective period of the year before. Seasonally adjusted labour
costs went up by 1.2 per cent in October to December 2018.

In the private sector, labour costs without one-off pay items,
such as performance-based bonuses, increased by 1.6 per cent in
October to December 2018 compared to the corresponding quarter one
year ago. Over the same period, the index of wage and salary
earnings for the private sector went up by 2.3 per cent.

Year-on-year change in labour costs in the private
sector from the corresponding quarter of the previous year

In the central government sector, the cost of an hour worked
increased by 5.7 per cent in October to December 2018 when compared
with the respective period of the year before. Seasonally adjusted
labour costs went up by 5.0 per cent. The rise in costs was mainly
due to the growth in wages and salaries subject to preliminary
withholding tax. About a third of the rise in costs was due to
decline of hours worked. Over the same quarter, the index of wage
and salary earnings in the central government sector went up by 2.3
per cent.

In the local government sector, the cost of an hour worked
increased by 1.6 per cent in October to December 2018 when compared
with the respective period of the year before. The year-on-year
change in labour costs without one-off pay items increase was 1.2
per cent. Over the same period, the index of wage and salary
earnings in the local government sector went up by 1.7 per
cent.

The cost per an hour worked went up by 1.8 per cent in
manufacturing industries (B to E), by 4.2 per cent in construction
(F) and by 0.1 per cent in business service activities (G to
N) in July to September 2018.

In manufacturing industries in the fourth quarter of 2018, there
was a rise of 1.8 per cent in the forest industry. In the food
industry costs went up by 2.3 per cent and in the chemical industry
labour costs went up 1.1 per cent respectively. Among service
industries, the biggest rise in costs, 2.1 per cent, was in
wholesale and trade. In information and communication activities,
costs decreased by 4.8 per cent.

The seasonally adjusted cost of an hour worked in all
manufacturing (B to E) went up by 1.8 per cent in October to
December 2018 compared with the corresponding period last year. In
construction (F), the seasonally adjusted cost of an hour worked
increased by 4.5 per cent and in business service activities (G to
N) increased by 0.1 per cent.

In manufacturing industries seasonally adjusted cost of an hour
worked went up by 2.5 per cent in the forest industry and in
chemical industry labour costs went up 1.4 per cent in the October
to December period of 2018 from the same period of the previous
year. In business service activities, seasonally adjusted costs
rose by 2.2 per cent in trade and by 0.7 per cent in transportation
and storage. In information and communication there was a 4.7 per
cent decrease in the seasonally adjusted costs.

The Labour Cost Index measures the change in wage and salary
costs calculated per hour worked. Hours actually worked refer to
the working hours an employee has spent on his/her actual duties.
Hours worked include Sunday and overtime work but not paid hours
off work, like the hours of annual leaves, national holidays or
paid sickness absences.

In the index, hours worked or the structure of personnel have
not been standardised. The cost of an hour worked is calculated
directly as the ratio of industry-specific wages and salaries sum
and social insurance contributions to the hours worked for each
quarter. The change in average labour costs is affected by changes
in regular earnings, performance-based bonuses and other one-off
pay components, social insurance contributions, as well as changes
in the number of hours worked and the structure of the labour
force.